SHARE AND SHARE ALIKE

THE INS AND OUTS OF A GROUP MORT­GAGE

Solihull News - - HOME ADVICE -

S har­ing prop­erty costs with friends has be­come a pop­u­lar op­tion, pushed by ris­ing rents which can make own­er­ship a cheaper choice.

M& S Bank cal­cu­lates three out of five 18- 35s would con­sider a group mort­gage – against one in four over 35s.

Many can af­ford monthly re­pay­ments – some­times less than rent. But sav­ing up for a de­posit is tough with get­ting that cash sum seem­ing like a never end­ing tread­mill.

The most pop­u­lar way of get­ting the down pay­ment is get­ting to­gether with part­ners, friends or work col­leagues, prefer­ably with sim­i­lar ages and tastes.

If you can’t find a suit­able home part­ner, there are web­sites putting home pur­chase shar­ers to­gether in­clud­ing share a mort­gage. com and prop­erty buy­ers match. co.uk. Think dat­ing site meets mort­gage finder.

But mort­gage ex­pert Ray Boul­ger, at on­line bro­ker Char­col, warns against shar­ing with com­plete strangers. “It’s mad­ness,” he says. “You should get to know each other by rent­ing to­gether for at least six months. Mort­gages are very ex­pen­sive to get out of.”

Many lenders, in­clud­ing Bar­clays, Wool­wich, Lloyds and NatWest as well as M& S, al­low up to four friends to share a loan. The pro­por­tion each owns can de­pend on how much an in­di­vid­ual can af­ford, al­though equal­ity is the best plan. Hav­ing a dom­i­nant sharer rarely works for long.

Of­ten a one bed­room flat is only a lit­tle cheaper than some­thing with two bed­rooms – with four shar­ers, the prop­erty is more affordable.

Many pre­fer shar­ing to stay­ing alone in a tiny flat or bed­sit. Ben­e­fits to liv­ing with oth­ers in­clude hav­ing com­pany, di­vid­ing tasks and costs, hav­ing some­one to lis­ten to your woes, and even some­one to watch a box set and di­vide a gi­ant pizza with.

You have to do your home­work, how­ever. Be­sides com­pata­bil­ity and jump­ing mort­gage hur­dles, en­sure the prop­erty has enough space for each per­son ( or cou­ple) to main­tain some pri­vacy – wafer thin walls are no help. Not every­thing will be smooth.

And plan ahead. One or more of the shar­ers will move away even­tu­ally. The eas­i­est so­lu­tions are rent­ing the spare space, bring­ing in new shar­ers, or a pre- ar­ranged scheme to pur­chase an un­wanted slice of the prop­erty.

Shar­ing a mort­gage with friends will mean it’s eas­ier to get on the prop­erty lad­der

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